Business News

Tobacco sales fetch US$258m

Tobacco sales have reached 110 million kilogrammes worth US$258 million, with deliveries to contract companies and floors steady, as farmers expect the forex auction system to ensure their viability.

Farmers morale had declined in the early weeks of the season as they found the fixed $25:US$1 exchange rate inadequate.

So far, farmers have sold 110 million kilogrammes of tobacco worth US$258 million compared to 111 million kilogrammes worth US$202 million by this stage of the season last year.

Prices have this year continued to firm with the average price at US$2.36/kg compared to US$1.81/kg at the same stage last year.

The overwhelming bulk of the crop has been delivered to contract companies who supplied the inputs to farmers they had under contract, with only 4.2 million kilogrammes produced by independent farmers sold through the auction floors.

Tobacco Association of Zimbabwe president, Mr George Seremwe, said since the announcement of the foreign currency auction system deliveries had remained consistent, but said some farmers were expecting the rate to increase so they could get value for their money.

“Some few farmers have withholding their crop in anticipating for a higher foreign currency rate at the auction,” he said. 

“A good exchange rate will enable farmers to go back to the land without challenges.” 

Tobacco Industry and Marketing Board chief executive, Dr Andrew Matibiri confirmed that sales had remained consistent.

“Farmers are hopeful that the rate will continue to firm so they can prepare for the next season,” he said.

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Source
Herald
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